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[2008] WASCA 207
respondent. Appeal dismissed. Although the trial judge erred in holding that the presumption of advancement applied, the finding that Mr Carey intended to create trusts for his daughters was upheld. The trial...
The Court of Appeal held that Mr Carey’s daughters could not rely on the presumption of advancement simply because their father put money into accounts bearing their names. The legal rights against the credit society remained with Mr Carey, so there had been no transfer of legal title that could trigger that presumption. But the court upheld the separate finding that he intended to hold the money for his daughters. His conduct, statements, and fax to the credit society supported that conclusion. The appeal was dismissed.
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2,272 words · generated 01/10/2026
The dispute concerned money Mr Carey placed into two accounts held in his name as trustee for his daughters, Caitlin and Kourtney, and the later use of that money to purchase a house. The central question on appeal was not simply whether the deposits were made, but whether Mr Carey intended to hold the resulting rights to the money for his daughters’ benefit.
No linked legislation citations have been extracted yet.
The accounts existed before the large deposits. Mr Carey opened an account styled “Joshua Anthony Carey Trust for Caitlin Carey” and another styled “Joshua Anthony Carey Trust for Kourtney Carey” on 1 July 1999. He made modest deposits and transfers over the next few years. By 31 December 2002, each account had a balance of $235.20 ([4]–[5]).
After selling his Suburb A home, Mr Carey deposited $82,167.73 into each account on 13 March 2003. The funds came from the house sale ([6]–[7]). Six days later, in a fax to the credit society, he described himself as trustee for his daughters and said each had $82,400 invested in her account ([8]). He was also arranging to buy a new home in his own name.
On 23 April 2003, Mr Carey withdrew $82,500 from each account, leaving $65.48 in each. The withdrawn funds were moved through his own account to facilitate payment of the settlement balance on the Suburb C property. At settlement, $165,000 had come from the daughters’ accounts and $12,115.76 from Mr Carey’s own funds ([10]–[11]).
After Mr Carey’s death, his daughters claimed that the deposits were held on trust for them and that the house purchased with the money was held on constructive trust. The trial judge made declarations that the account funds were held on trust and that the house was held on trust in proportions of 46.58 per cent for each daughter and 6.84 per cent for the estate ([15], [32]). The Court of Appeal dismissed the appellant’s appeal, although it rejected one part of the trial judge’s reasoning concerning the presumption of advancement ([34]–[36], [47]).
The Court separated two legal questions. First, could the presumption of advancement establish that the daughters received the beneficial interest? Second, independently of that presumption, did the evidence establish that Mr Carey intended to create trusts?
On the first question, the Court held that the presumption of advancement had no application. It described that presumption as an exception to the presumption of resulting trust. The relevant setting for advancement is one in which legal title to property is transferred in a relationship, such as father and child, where equity may infer that the benefit was intended as an advancement ([34]). But the deposits did not transfer legal title to the daughters. The credit society owed repayment to Mr Carey, meaning he held the relevant legal choses in action. Since no legal title passed to the daughters, there was no room for a resulting trust presumption or its advancement exception ([35]).
That conclusion meant the trial judge had erred in finding that the presumption of advancement arose. But the error did not decide the appeal. The trial judge’s primary conclusion was that the evidence established an actual intention to create trusts, and the Court assessed that conclusion separately ([36]).
For an express trust to arise, the court identified the need for certainty of subject matter and object, certainty as to the trustee, and certainty of the personal obligation attached to the property. In this case the subject matter, beneficiaries and proposed trustee were not in dispute if the necessary obligation was found. There was no express declaration at the time of deposit, so the respondents had to establish the intention from the circumstances ([37]). The burden was to prove, on the balance of probabilities, that Mr Carey intended to place himself under a personal obligation to hold the choses in action for his daughters ([38]).
The Court agreed that 13 March 2003, when Mr Carey made the deposits, was the relevant date for assessing his intention. That did not make other surrounding circumstances irrelevant. His house sale, search for another property and relationship circumstances could be considered, but as evidence bearing on his intention at the time he put the money into the accounts ([39]).
The evidence supporting the trust finding was cumulative. The accounts were already held on trust for the daughters, a finding by the trial judge that was not challenged on appeal ([41]). Mr Carey’s decision to place his own funds into those existing trust accounts was significant. The Court noted that adding one’s own property to a trust fund of which one is trustee may amount to conduct evidencing an implied declaration of trust ([42]).
There was also evidence that Mr Carey had considered buying a home in his daughters’ names, but decided against that course because they were minors. The Court treated this as relevant evidence of an intention to benefit them, even though it was not direct evidence of the particular trust created by the deposits ([43]). The daughters’ evidence that their father said he would use the money to buy a house and later pay it back was also consistent with his undertaking an obligation to hold the money for them ([44]).
Most directly, the 19 March fax described Mr Carey as trustee for his daughters and identified the amount invested in each account. Pullin JA characterised it as strong subsequent evidence of intention and an admission against interest ([45]). Taken together, these circumstances supported the inference that Mr Carey intended to create trusts when he deposited the funds ([46]).
The judgment does not purport to establish a new general test for all transfers between parents and children. It applies existing trust and presumption principles to the particular legal form of these deposits.
Before the decision, the trial judge had found both that Mr Carey intended to create trusts and that a presumption of advancement applied. The Court of Appeal corrected the second part. Its explanation was that the presumption of advancement is not a free-standing rule that automatically converts any benefit from a parent to a child into a gift. Rather, it operates in the context of a transfer of legal title where a resulting trust might otherwise arise ([34]).
The judgment’s clarification is tied to the distinction between transferring property and depositing money with a financial institution. Here, the credit society’s obligation to repay the funds was a chose in action held legally by Mr Carey. The daughters did not receive legal title to that chose in action merely because the accounts were described as trust accounts ([35]). This distinction explains why the advancement presumption failed, while leaving open the possibility that actual intention could still establish a trust.
The decision also illustrates the difference between an inferred express trust and a trust presumed by law. The respondents succeeded on the former reasoning: the Court upheld the finding of actual intention based on the evidence. The presumption of advancement was unnecessary to that result and, in this case, unavailable ([36]–[38], [46]).
The judgment does not formulate a universal evidentiary checklist. It instead shows the kinds of circumstances considered in this dispute: the prior character of the accounts, conduct at the time of the transfer, statements to the beneficiaries, and a written statement shortly afterwards describing the transferor as trustee ([41]–[45]). Its insistence that intention be assessed at the time of the transaction is paired with recognition that surrounding circumstances may assist in drawing the inference ([39]).
At [35], the Court states that no legal title was transferred to the daughters, so “there was no room for the operation of the presumption of advancement.” In plain English, the parent-child relationship alone did not activate the presumption. The legal rights against the credit society remained with Mr Carey, and the case therefore had to turn on whether he actually intended to hold those rights for his daughters.
At [38], the Court says the respondents had to prove that Mr Carey intended “to place himself under a personal obligation” to hold the relevant property for their benefit. This makes intention more than a question of whether he hoped his daughters would eventually benefit. The question was whether he meant to assume the obligation of a trustee in respect of the money represented by the accounts.
At [40], the Court cautions that speculation about why Mr Carey acted as he did could not decide the case. Possible motives could be imagined, but the court had to rely on facts. This is important because the surrounding circumstances could support more than one possible narrative. The legal finding had to rest on evidence, not conjecture.
At [42], the Court treats Mr Carey’s addition of money to accounts already held on trust as significant conduct. The point is not that every addition of personal funds to a trust account necessarily creates a new trust. The court regarded the act as relevant evidence in the context of the existing trust relationship and the other evidence.
At [45], the 19 March fax is described as “very strong ex post facto evidence” and an admission against interest. In ordinary terms, the fax was written after the deposits, but close enough to them to be relevant to the intention at the time. Its importance came from Mr Carey’s own description of himself as trustee and his statement that each daughter had money invested in her account.
At [46], the Court concludes that the evidence supported the trial judge’s finding of intended trusts, notwithstanding the error concerning advancement. This is the core disposition: the appeal failed because the independent factual inference of trust intention remained sound.
The decision is relevant where a parent places funds with a bank or credit society in accounts described as being held for children, but the legal account relationship may leave the parent holding the enforceable right to repayment. It shows that the label attached to an account does not, by itself, resolve whether a trust exists. In this case, the label mattered as part of the wider evidence, particularly because the accounts were already found to be trust accounts before the substantial deposits ([41]).
It may also be relevant where a party argues that a presumption of advancement resolves beneficial ownership simply because the transferor was a parent and the intended beneficiaries were children. Langley v Carey requires attention to whether legal title was transferred and whether a resulting trust could arise in the first place ([34]–[35]).
The case is also pertinent where no written trust declaration was made at the time of transfer, but the alleged trust is said to be inferable from conduct and statements. The court looked at the prior account arrangements, the transferor’s addition of funds, statements made to the daughters, and the near-contemporaneous fax ([41]–[45]). It does not establish that any one of those factors is decisive in other cases.
Finally, it bears on disputes where funds are later withdrawn and used to purchase property in the transferor’s own name. The appeal concerned the trust intention at the time of the deposits, not simply the later purchase. The court upheld the trial judge’s identification of the deposit date as the relevant time for that inquiry ([39]).
The supplied judgment text contains no decisions subsequent to Langley v Carey discussing or applying it. It therefore does not provide a basis for describing how later courts have treated the decision, whether it has been followed, limited or distinguished, or whether its reasoning has been adopted in other contexts.
The judgment itself cites earlier authorities, including Calverley v Green, Charles Marshall Pty Ltd v Grimsley, Napier v Public Trustee, and Jolliffe. Those citations explain the legal framework applied by the Court of Appeal; they are not evidence of later treatment of Langley v Carey. Any assessment of later judicial treatment would require later decisions not included in the source material.
The judgment resolved the appeal on the evidence and arguments before it. It expressly notes that no issue was raised at trial or on appeal about whether a trust, if created, was revocable ([38]). It therefore did not decide that question.
The Court did not need to determine the full consequences of the trust finding for every aspect of the later property transaction. The appellant did not dispute that, if Mr Carey intended to create trusts when he deposited the money, the trial judge’s conclusion that the Suburb C property was held on constructive trust followed ([16]). The appeal’s contested focus was the deposits and the presumption of advancement.
The judgment also does not give a comprehensive account of what kinds of account documentation or banking arrangements would amount to a transfer of legal title in other circumstances. Its conclusion depended on the legal relationship between Mr Carey and the credit society as described in the case: Mr Carey held the rights to repayment ([35]).
Nor does the decision establish a rule that later statements are generally reliable evidence of earlier intention. The Court noted concerns about the admissibility or use of some later statements, and its conclusion rested on evidence it considered supportive, including the fax as an admission against interest ([25], [45]–[46]). The precise evidentiary treatment of later declarations may therefore depend on their timing, content, context and whether they are against the maker’s interest.
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The names and identifying details of all persons associated with, or concerned in, the proceedings have been changed.
2 PULLIN JA: This is an appeal against the judgment of Hasluck J who declared that two sums of money paid by the respondents' father into accounts in his name as trustee for the respondents was money held on trust for the respondents and that a property bought in the father's name using money from those accounts was held on a constructive trust for the respondents.
3 The following facts are not in dispute. The respondents' father, Mr Carey, was born in 1954. He married Julie Kennedy Hayes on 28 July 1990. The respondents were children of the marriage. Caitlin was born on 28 February 1992 and Kourtney was born on 2 December 1994. Mr Carey and Ms Kennedy Hayes were divorced in early 1997. After the divorce, Mr Carey owned and lived in a house at 24 C Road, Suburb A.
4 Before 1 July 1999, Mr Carey opened an account with the Police & Nurses Credit Society in his own name. On 1 July 1999, Mr Carey opened a new bank account with that credit society in the name of 'Joshua Anthony Carey Trust for Caitlin Carey' (Caitlin's Account). On the same day he opened a bank account with the credit society in the name of 'Joshua Anthony Carey Trust for Kourtney Carey' (Kourtney's Account). These will be referred to together as his 'daughters' accounts'. On 8 July 1999, Mr Carey deposited $50 into each of his daughters' accounts. On 10 July 1999, he transferred $25 from his account into Caitlin's Account and $25 into Kourtney's Account.
5 The daughters' accounts earned small amounts of interest. Further payments were made into them by transfers from Mr Carey's account from time to time. $50 was transferred on 8 January 2000 and on 6 July 2002 he transferred $100 into each account. As at 31 December 2002, each account had a credit balance of $235.20.
6 In late 2002, Mr Carey met the appellant. Mr Carey began staying at the appellant's house at Suburb D. Mr Carey was offered a new job and he discussed with the appellant selling his house in Suburb A and in January 2003 the appellant and Mr Carey looked at a few properties in Suburb D. In late January 2003, Mr Carey entered into a contract to sell the Suburb A property for $171,000 and settlement with the purchaser occurred on 11 March 2003.
7 On 13 March 2003, Mr Carey deposited one cheque amounting to $82,167.73 into Caitlin's Account. He deposited another cheque for the same amount into Kourtney's Account on the same date. The money was derived from the proceeds of the settlement of the sale of the Suburb A property. On 31 March 2003, interest was credited to Caitlin's Account and Kourtney's Account in the sum of $162.55 and on 30 April 2003, interest was credited in the sum of $208.12.
8 On 15 March 2003, Mr Carey made an offer to purchase in his own name, a property at 47 B Road, Suburb C, for the sum of $171,000. The offer was accepted on 16 March 2003. On 19 March 2003, Mr Carey sent a fax to Police & Nurses Settlements. The fax read:
Good afternoon,
My membership no. is [number A], I currently have $2495.00 in the account. I have purchased a home for $171,000.00 and paid $1,000.00 deposit yesterday, so my balance is $2495.00. I am the trustee for my (2) daughters, Caitlin member no. [number B] and Kourtney, member no. [number C].
Each daughter, currently has $82,400.00 each invested in their accounts.
I am applying for a personal loan of $10,000.00 with Police & Nurses, which I will lodge a loan application late p.m. / 20-3-03 in Suburb G.
I have nominated Police & Nurses Settlements to handle the purchase of 47 B Rd, Suburb C.
I have sufficient funds to pay stamp duties, rates, settlement fees and the purchase of this home, once the loan application is approved. Please note, my current address is: 502 H Road, Suburb B, 6081.
Thank you and regards,
Josh Carey
P.S. Settlement is expected to take place in 6 weeks time, once probate has been granted.
9 At the time Mr Carey wrote the fax, there is no doubt that he was in a relationship with the appellant but in the period between the sale of the Suburb A property and the date on which Mr Carey moved into the Suburb C property, he lived with his aunt Vanessa Hall.
10 The credit society approved the loan of $10,000 to Mr Carey. A settlement statement relating to the Suburb C property and dated 24 April 2003 showed that the balance of the purchase price to be provided by Mr Carey for the Suburb C property was $169,584.11.
11 On 23 April 2003, Mr Carey withdrew the sum of $82,500 from the account of each daughter, leaving in each a credit balance of $65.48. These moneys were transferred into Mr Carey's account to facilitate the drawing of a cheque for $169,584.11, being the amount due on settlement for the Suburb C property. Thus, when settlement of the Suburb C property took place, $165,000 was paid from funds which had been drawn from the daughters' accounts. $12,115.76 was paid by Mr Carey from his own funds.
12 After settlement, Mr Carey and the appellant lived together at the Suburb C property. The appellant left Mr Carey in early May 2004. There is evidence in the form of letters and notes suggesting that Mr Carey felt responsible for the separation and blamed himself for what occurred. He expressed and continued to harbour a strong feeling of emotional attachment to the appellant and made it plain that he was distressed by her departure.
13 On 8 May 2004, Mr Carey completed a printed form which purported to be his last will and testament. The document was not signed by him in the presence of two witnesses in the manner required by s 8 of the Wills Act 1970 (WA), but in a separate probate action, it was admitted to probate as an informal will pursuant to s 34 of the Wills Act. The will appointed Vanessa Hall as executrix of his estate. He gave to the appellant 'my house and land at 47 B Road, Suburb C ... to dispose of, as she feels fit, to provide financial security to her and her children'. The will also stated that his AMP super plan which included an extra death benefit, nominated his daughters Caitlin and Kourtney as joint beneficiaries. The will did not refer to his daughters' accounts.
14 Later on 8 May 2004, Mr Carey committed suicide. He left two notes dated 8 May 2004. One was a lengthy letter to the appellant which included a statement that:
My will is my gift to you, Brad and Sally, to give you either a home to live in or sell it, pay off all your debts, including the car, buy a unit and remember that I loved you more than you will ever know.
15 The respondents sued Ms Hall as executrix of Mr Carey's will and the appellant. In the statement of claim the respondents pleaded that the two sums of $82,167.73 paid into Caitlin's Account and Kourtney's Account were held on trust for the respondents. The statement of claim also pleaded in the alternative that 'the transfer of the ... monies into the ... accounts in the names of the [respondents] was an advancement by the deceased to the [respondents]'. Finally, the statement of claim pleaded that by reason of the use of the moneys to purchase the Suburb C property, the Suburb C property was held on a constructive trust for the respondents.
16 Counsel for the appellant informed this court that if Mr Carey did intend to create a trust in favour of the respondents when he deposited the moneys into his daughters' accounts on 13 March 2003, then the appellant did not dispute the trial judge's conclusion that the Suburb C property was held on a constructive trust for the respondents.
17 The appellant pleaded in the defence, and provided particulars, that Mr Carey informed both the appellant and Ms Hall, that from the receipt of the moneys from the sale of the Suburb A property, that Mr Carey 'would place the sale proceeds in the bank account belonging to his children temporarily' until he found and purchased another property, and that he was doing this so that any interest earned on the moneys deposited would be given by him to his children. The particulars stated that this information was given to the appellant and Ms Hall 'on/or about the material time between the sale of the Suburb A property and the depositing of the sale proceeds in the children's account'. The particulars to the defence also stated that the appellant 'can only recollect that the intention and stated aim of the deceased was to sell his Suburb A home and to temporarily deposit the funds he received from the sale into his children's account until he found and was able to purchase a subsequent home for himself, which he did at 47 B Road, Suburb C'. The particulars also stated that she could not recollect the precise words used by the deceased.
Oral testimony about oral statements made by Mr Carey before 23 March 2003
18 Mr Carey's former wife, Mrs Kennedy Hayes, gave evidence. She that in about December 2002, about the time that he was selling his Suburb A house, he told Mrs Kennedy Hayes that he wanted to buy a house in the children's names, but that later he said that he would not do that because they were minors. The appellant submitted that this evidence was irrelevant because it did not relate to Mr Carey's intention in relation to the deposit of the moneys into Caitlin's Account and Kourtney's Account. There was no ground of appeal to that effect, however, in my opinion the evidence was relevant as an indication that Mr Carey did intend to benefit his children from the main source of funds available to him, namely, the proceeds of the sale of his house.
19 The respondent, Kourtney Carey, gave evidence that on a Saturday, the date of which she could not recall, she was taken to the credit society with Mr Carey. She said:
We went inside the bank. He went up to the reception or the person and he came back and showed us a receipt and he then told us that he put this money inside our account and he told us he was going to take it out so he could buy a new house, and then he said he would pay it back to us.
20 The respondent Caitlin Carey also gave evidence. She said that one weekend Mr Carey had taken her sister and her to the credit union and shown them a receipt showing how much they had in their accounts. She said that this was around the time when their father was boarding in Ms Hall's house after he had sold the Suburb A house. She said that her father showed her a piece of paper that showed an amount of money and that he said 'that he had sold the Suburb A house and that he had put the money into me and my sister's account and that he would use that money to buy a new house and that he would give it back to us one day'. She said she could not remember the amount of money in the account, but that it was 'a lot'. He told Caitlin that he was going to use the money to buy the Suburb C house.
Testimony and evidence not relied on by the appellant or which was inadmissible
21 The appellant gave evidence that Mr Carey had said that 'he put' the money from the sale of the Suburb A house into his daughters' accounts so that they could have the interest on the money until the money was used to purchase himself a new house. Ms Hall gave evidence that Mr Carey said that 'he had put' the money from the sale of the Suburb A house into his daughters' accounts so that they could have the interest on the money. However, in cross‑examination both the appellant and Ms Hall said that Mr Carey told them that he was 'going to put' the money into the daughters' accounts. There is a significant difference in these two versions because as Dixon CJ, McTiernan, Williams, Fullagar and Taylor JJ said, in Charles Marshall Pty Ltd v Grimsley [1956] HCA 28; (1956) 95 CLR 353, 366, when speaking about evidence which could be led to rebut the presumption of advancement and to prove intention:
Subsequent statements or acts by the donor could only be evidence not for but against him so far as they were admissions that the plaintiffs were the beneficial owners of the shares. Subsequent statements or acts by the plaintiffs could only be evidence not for but against them so far as they were admissions that the shares were allotted to them as trustees for their father.
22 In Calverley v Green [1984] HCA 81; (1984) 155 CLR 242, 252, Gibbs CJ observed that the extent of the beneficial interest of the respective parties must be determined at the time when the trust was created. Mason and Brennan JJ, citing Charles Marshall Pty Ltd v Grimsley, said at 262: the evidentiary material from which the court might draw an inference as to the intention of the parties includes their acts and declarations before or at the time of purchase, or so immediately after it so as to constitute a part of the transaction. Evidence of those acts and declarations are admissible either for or against the party who did the act or made the declaration, but any subsequent declarations are admissible only as admissions against interest. See also Perpetual Trustees WA Ltd v Goyder (Unreported, WASC, Library No 990138, 24 March 1999), 9 ‑ 11. In Calverley v Green, 269, Deane J, after referring to the passage in Charles Marshall Pty Ltd v Grimsley said:
[It] should not, however, be accepted as good law to the extent that it purports to lay down that no evidence other than that mentioned will ever be admissible.
This statement should not be understood as meaning that statements of intention made after the transaction and not against interest would be admissible. What Deane J meant was, that evidence such as evidence of the relationship between the parties and other surrounding circumstances which prevailed at the time of the transaction, would be admissible, as well as the acts and statements of the kind referred to in Charles Marshall Pty Ltd v Grimsley. Thus in the Perpetual Trustees case, Commissioner Martin (as he then was) said that evidence of the terms of a will which had been made before the relevant transaction, was relevant to the issue of the actual intention of the person making the payment, but because it was not evidence of an act or declaration by him directly relevant to the transaction, the learned commissioner said that he considered that the evidence was a 'significantly less reliable guide to the actual intentions of the parties' to the transaction.
23 At [169] of his reasons, the trial judge in this case, said that the evidence of the appellant and Ms Hall 'was not convincing, because it was not specific' and said that there was 'no independent evidence' that 'payment in was for the benefit of earning interest only' [172]. However, his Honour went on to say that 'I am inclined to give little weight to the testimony of Vanessa Hall and Ms Langley which was adduced with a view to substantiating' that the payment in was for the benefit of earning interest only [172].
24 There is no ground of appeal alleging that the trial judge erred in not making a finding about whether the appellant's statements and Ms Hall's statements were made before or after the deposit of the moneys into the account. Counsel for the appellant expressly disclaimed any reliance on anything which was said by the appellant and Ms Hall in determining what might have been Mr Carey's intention at the time the deposits were made.
25 Evidence about what was said by Mr Carey in his suicide notes, and in his will, which were written in May 2004, was taken into account by the trial judge even though it would appear not to be admissible evidence about Mr Carey's intention at the time he made the deposits over 13 months before, on 13 March 2003.
26 The trial judge, after referring to the undisputed facts and to the pleadings, made findings that the funds utilised by the deceased to make the deposits of $82,167.73 into his daughters' accounts on 13 March 2003 formed part of the sale proceeds of the Suburb A property [63].
27 The trial judge correctly identified the crucial issue which was about the intention of the deceased on 13 March 2003 when he made the deposits into Kourtney's Account and Caitlin's Account.
28 As mentioned above, the trial judge said that the evidence of Ms Hall and the appellant was 'not convincing' and that he would give their evidence 'little weight' for reasons not now relevant in view of the appellant's statement that no reliance was placed on anything they said.
29 As to the evidence of the testimony of Mrs Kennedy Hayes and the respondents about statements made by Mr Carey before or contemporaneously with the transactions, his Honour said that he had 'reservations' about their testimony because each of them had an interest in the outcome of the litigation and because of the age of the respondents at the time of their visit to the credit society [170]. However, his Honour said:
Nonetheless, I am prepared to give some weight to the evidence they gave about that matter and the deceased's assertion that he would use the money obtained from the Suburb A property to buy the Suburb C property but would give it back to them one day. I give some weight also to Julie Kennedy Hayes's evidence of a statement made by the deceased that he could not put the house in the children's names [170].
30 His Honour then said that he must be guided principally by drawing together various factors emerging from the objective evidence [171] and then said:
As at 13 March 2003 the deceased was fond of and was clearly minded to benefit his daughters. The deceased knowingly paid the funds into accounts described as trust accounts. Within a few days, in the crucial 19 March fax, he described himself as a trustee of the funds invested on their behalf. There is no independent evidence that the payment in was for the benefit of earning interest only, and I am inclined to give little weight to the testimony of Vanessa Hall and Ms Langley which was adduced with a view to substantiating that point. In addition, the terms of the 19 March fax suggest that, as a trustee, the deceased saw himself as being at liberty to use the funds as he saw fit, which tends to explain why he immediately purchased another property in his own name.
For the reasons given in earlier discussion, I am of the view that all these considerations taken together displace what was said by the deceased in the 8 May letter and disputed Will. They permit me to infer, as I do, that the deceased intended to create a trust for the benefit of his daughters by paying the funds into the accounts in question. In breach of the fiduciary duty he owed to each daughter as a trustee, he then used the trust funds to buy a new house at Suburb C for himself in the mistaken belief that it was permissible for a trustee to act in this manner, provided the funds were repaid eventually or the house itself was given to the daughters in due course. [172] ‑ [173]
I pause to say that the evidence I have just described gives rise to a presumption of advancement and is sufficient to rebut any presumption of resulting trust that might be relied on with a view to establishing that the deceased was both the legal and beneficial owner of the Suburb C property [174].
32 Judgment was then entered in the following terms:
(a) Caitlin Carey as to 46.58%;
(b) Kourtney Carey as to 46.58%; and
(c) The First Defendant in her capacity as executrix of the estate of the Deceased as to 6.84%.
33 The appellant's grounds of appeal allege that the trial judge erred in concluding that the deceased intended to create a trust for the benefit of his daughters when depositing the moneys, erred in holding that a presumption of advancement arose and erred in holding that the presumption of advancement was not rebutted. The appellant also alleged that the trial judge erred in 'determining the question as to whether or not a trust was created by reference to the deposit of the proceeds of the sale of the Suburb A property into the daughters' accounts and not by reference to the purchase of the Suburb C property'.
34 Although the respondents pleaded in their statement of claim that 'the transfer of the said moneys into the said accounts in the names of the [respondents] was an advancement by the deceased to the [respondents]', and although the trial judge held that there was a presumption of advancement which had not been rebutted, this was not a conclusion which was open on the facts. The presumption of advancement is by way of exception to another presumption. The latter presumption is that a resulting trust will be presumed where, on a purchase, the legal title to property is vested in someone other than the person who is proved to have provided the purchase money: Heydon J C and Leeming M J, Jacobs' Law of Trusts in Australia (7th ed, 2006) [1210]. This proposition is subject to the exception that in certain circumstances (including a transfer of legal title by a father to his child) there is a presumption of advancement so that the beneficial as well as the legal interest will pass: Napier v Public Trustee (Western Australia) (1980) 55 ALJR 1. The words emphasised in italics show that the transfer of a legal interest must pass before the presumption of advancement arises. As said in Calverley v Green (Deane J):
the presumption of advancement is not, if viewed in isolation, strictly a presumption at all. It is simply that there are certain relationships in which equity infers that any benefit which was provided for one party at the cost of the other has been so provided by way of 'advancement' with the result that the prima facie position remains that the equitable interest is presumed to follow the legal estate and to be at home with the legal title or, in the words of Dixon CJ, McTiernan, Fullagar and Windeyer JJ in Martin v Martin [1959] HCA 62; (1959) 110 CLR 297, 303, that there is an 'absence of any reason for assuming that a [resulting] trust arose' (267).
35 In this case there was no transfer of legal title of any property to Mr Carey's daughters. Mr Carey paid money into Kourtney's Account and Caitlin's Account. As between the credit union and Mr Carey, Mr Carey then became the legal owner of a right to repayment of sums equivalent to those paid to the credit union on 13 March 2003. In other words, and using the jargon of the law, Mr Carey became the legal owner of legal choses in action entitling him to repayment: Croton v The Queen [1967] HCA 48; (1967) 117 CLR 326, 330. As there was no transfer of any legal title to any property by Mr Carey to his daughters on 13 March 2003 there was therefore no possibility that a resulting trust could arise and therefore no room for the operation of the presumption of advancement.
36 The appellant's grounds of appeal which contend that the trial judge erred in concluding that the presumption of advancement applied and had not been rebutted, must therefore succeed; but that does not deal with the primary basis for the judgment which was that Mr Carey intended to create a trust for his daughters on 13 March 2003 when he deposited the money into their accounts.
Did Mr Carey intend to create a trust on 13 March 2003?
37 The result of what is set out under the previous heading is, that the only issue to be determined is whether Mr Carey intended when he deposited the moneys into the two accounts, that the resultant choses in action would be held on trust for the respondents. For an express trust to arise, there must be certainty of subject matter and object, certainty as to the trustee and, relevantly in this case, certainty of the personal obligation annexed to the property. In the absence of evidence of an express declaration of trust, it is essential to the creation of a trust that there be proof of an intention to create a trust: Commissioner of Stamp Duties (Queensland) v Jolliffe [1920] HCA 45; (1920) 28 CLR 178, 181, (Knox CJ and Gavan‑Duffy J) 188, (Isaacs J). In this case there is no dispute as to subject matter and object, or the identity of the trustee if the finding is that Mr Carey did impose on himself a personal obligation to hold the choses in action for the benefit of the respondents. This is not a case where there is any evidence of an express declaration of trust at the time of the deposit of the moneys. This is a case where the respondents contended that upon a consideration of all of the circumstances including relevant oral evidence, the court should infer that Mr Carey intended to create a trust in favour of his daughters: Bahr v Nicolay (No 2) [1988] HCA 16; (1988) 164 CLR 604, 618 ‑ 619 (Mason CJ and Dawson J); Trident General Insurance Co Ltd v McNeice Bros Pty Ltd [1988] HCA 44; (1988) 165 CLR 107, 120 ‑ 121 (Mason CJ and Wilson J).
What had to be shown to be Mr Carey's intention?
38 What had to be proved by the respondents on the balance of probabilities was that Mr Carey intended to place himself under a personal obligation to hold the trust property, namely the choses in action, for the benefit of the respondents: DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties (1980) 1 NSWLR 510, 518 ‑ 519. No issue was raised at trial or on appeal about whether, if such a trust existed, it was revocable.
39 One aspect of the appellant's grounds of appeal was that the trial judge erred in concluding that the relevant transaction and the relevant time for determining the appellant's intention was on 13 March 2003 when the moneys were deposited into Kourtney's Account and Caitlin's Account. However, in oral submissions, counsel for the appellant appeared to be submitting merely that all of the surrounding circumstances, namely the fact that Mr Carey had owned the Suburb A house, that it was his money and that it was clear that he was looking for another house, were all circumstances indicating that he did not intend that when he paid the moneys into his daughters' accounts, that he would thereby hold the beneficial interest in the chose in actions in trust for his daughters. There is no doubt that those surrounding circumstances are relevant, but the trial judge was correct in identifying 13 March 2003 as the date on which the intention of Mr Carey had to be determined.
40 The evidence in the case appears overwhelmingly in support of the conclusion that the trial judge reached. Speculation might arise as to why a man of Mr Carey's age should divest himself of the only substantial asset he had; namely, the moneys representing the value of his home. It is possible to speculate that he might have only intended to temporarily deposit his money in his daughters' accounts, intending to keep control of it for his own benefit. On the other hand, it is also possible to speculate that because he loved his daughters and was just entering into a de facto relationship with the appellant, that he wanted to ensure that, if the relationship failed at some time in the future, his property should be protected from any claim on his property which might be made by the appellant. Of course, speculation about Mr Carey's intention is not permissible as a means of determining the case. Only the facts may be referred to in order to determine the issue about Mr Carey's intention on 13 March 2003.
41 The facts show that Mr Carey paid money into Caitlin's Account and Kourtney's Account. The trial judge held that the 'other funds (ie the funds in those accounts before 13 March 2003) ... were undeniably held in trust for deceased's daughters' [166]. The mere opening of a bank account by a person in trust for another is not necessarily sufficient to make that person a trustee for the other person; Jolliffe's case; Kauter v Hilton [1953] HCA 95; (1953) 90 CLR 86, 100. However, in this case the trial judge's unchallenged finding that Mr Carey was trustee for his daughters in relation to the accounts as they existed before 13 March 2003 put it beyond question on this appeal that he was a trustee in relation to the accounts before 13 March 2003.
42 It is significant that Mr Carey paid his money into his daughters' accounts because conduct which may amount to an implied declaration of trust by a trustee is where a trustee adds property of his own to a trust fund of which he is trustee: JW Broomhead (Vic) Pty Ltd (in liq) v JW Broomhead Pty Ltd [1985] VicRp 88; [1985] VR 891, 921 and see the authorities and textbooks referred to there by McGarvie J. Such conduct occurred in this case.
43 In addition, Mr Carey told his former wife that he intended to purchase a house in the names of his daughters, but that he was deterred from following that course because of the perceived difficulties in having minors as owners of the property. Although that is not evidence of the particular trust in issue, it is evidence that he intended to benefit his daughters by some means.
44 The statements made by Mr Carey to his daughters at the credit union office, to which the trial judge gave 'some weight' [170], are also consistent with an intention to confer a benefit on his two daughters, particularly the statement to Kourtney that he would use the moneys 'and pay it back to us'. That affords evidence that Mr Carey had imposed upon himself the personal obligation to hold the choses in action on trust for the benefit of his daughters. The fact that Mr Carey did not pay the moneys into his own account at the credit union is also significant.
45 The 19 March 2003 facsimile (the 'crucial' fax as the trial judge described it) was very strong ex post facto evidence of his intention, and an admission against interest. The facsimile refers to the fact that he had certain money in his own account; he stated unequivocally that he was the trustee for his daughters in relation to the two relevant accounts and that 'each daughter, currently has $82,400 each invested in their accounts'.
46 All of the facts referred to above, support a conclusion that on 13 March 2003 when he deposited the moneys, Mr Carey intended to impose upon himself the personal obligation referred to above for the benefit of his daughters. Although the trial judge erred in his conclusion that the presumption of advancement applied, and although some evidence of ex post facto statements of intention not against Mr Carey's interests, appear to have been considered by his Honour, he did not err in his conclusion about Mr Carey's intention to create trusts in favour of his daughters.
(1956) 95 CLR 353
(1984) 155 CLR 242
(1980) 55 ALJR 1
(1967) 117 CLR 326
(1920) 28 CLR 178
(1988) 165 CLR 107
(1980) 1 NSWLR 510
(1959) 110 CLR 297
(1988) 164 CLR 604
(1953) 90 CLR 86
Appeal dismissed. Although the trial judge erred in holding that the presumption of advancement applied, the finding that Mr Carey intended to create trusts for his daughters was upheld. The trial judgment’s declarations and orders therefore remained undisturbed ([36], [46]–[48]).